ArcelorMittal imposed unfair terms on Algeria for almost 10 years

Algiers (10/12/2012) – ArcelorMittal’s funding crisis revealed a scandal about the humiliating conditions imposed on the Algerian government during the negotiations with the Indian partner in 2011, in exchange for buying the majority stake of Hadjar iron and steel company in Annaba (east of Algeria).

A source close to the Ministry of Industry, Small and Medium Enterprises and Promotion of Investment told Echorouk, that the hard and degrading guarantees obtained by the Indian partner in 2011, are unfair restrictions against Algeria, including the government’s commitments to prevent “Sedar” public company, which owns currently 30% of Annaba ArcelorMittal shares, from establishing investments in the iron and steel sector for almost 10 years, which is an unfair condition that has no basis in the economic terms, and even threats the economic interests of the country, which requires a review of this term and launch Sedar’s  projects in this area.

The Indian partner did not only prevent Algerian government from investing in the sector, but was also behind the closure of all production units in the private sector in Annaba, Msila and Taref (east of Algeria), as a direct result of the failure of the Indian company “ArcelrMittal-Annaba” to provide these units with the raw material, which were supplied by Hadjar compound before the sale of 70% of its shares to ArcelotMittal.

Echorouk sources said, the Algerian government will resort to checking out the unfair terms in the agreement with Indian partner after 10 years of entering to Algeria, and allowing the Algerian companies to create projects in this sector, after it suffered 10 years of delay and waited for a miracle from ArcelrMittal, which did not move although the privileges granted by Algeria in the field of supplying gas, electricity and eligible employees, and iron row materials as well.

The same sources added that ArcelorMittal has focused on its investments in Morocco, despite it entered the kingdom in 2006, and its share in the Moroccan factories does not exceed 64% compared to 70% in Algeria. However; ArcelorMittal preferred developing a new line for producing flat articles in its factory in the Moroccan town Enathour, although the rising prices of energy in the kingdom compared to Algeria.

The spokesperson explained that the Indian partner did not change anything during its presence for almost 10 years in Algeria, which obliged Algeria to import 90% of its annual needs of concrete iron from other countries such as, Turkey, Italy, Russia and Spain.